The news comes as Sony prepares to launch the PlayStation 3 in Europe and Australia in March, after releasing the console in North America and Japan in November. The PS3 competes with Microsoft's Xbox 360, which was released more than 12 months ago. Microsoft launched the Xbox Live Video video download service in November and several video download services, such as ReelTime and Bigpond Movies, are already compatible with the Xbox 360. The services also create competition for Apple's upcoming Apple TV video player.

The PS3 also sports a built-in Blu-ray player, while Microsoft offers an option HD DVD add-on for the Xbox 360.{moscomment}